KBR, Inc. (KBR - Free Report) has won a contract extension from BP p.l.c. (BP - Free Report) for phase 1 of the Greater Tortue Ahmeyim Project to provide Facilities Integration and Terminal Quarters and Utilities (“QU”) management services for the Hub/Terminal.
The Engineering, Procurement and Construction Management contract will be executed at the maritime border of Senegal and Mauritania. Per the deal, KBR will manage the QU contractor, and offer services for the QU Integrated Control, Safety System ICSS, Telecoms Systems and Supplemental Services.
Notably, the said project will provide LNG revenues and gas to Africa for decades.
KBR has been in the LNG industry for more than 40 years and contributing nearly one third of the world's total LNG production. In fact, recently, it has collaborated with Baker Hughes, a GE company to use the latter’s proven gas turbine driver technologies, featuring LM2500+G5 and LM6000PF gas turbines, for its standardized mid-scale LNG design.
Being active in the LNG industry for more than four decades, KBR remains committed to boost global LNG production for environmental reasons. Its Energy Solutions unit, accounting for 20.3% of revenues, is expected to benefit from selective opportunities in downstream petrochemical and ethylene projects, and a growing number of small-scale LNG projects in North America.
Energy Solutions’ backlog ($13.6 billion as of Mar 31, 2019) increased 20.2% in first-quarter 2019. Of the backlog, 75% represents service businesses that comprise high-end technical consultancy, pre-FEED, FEED, PMC, and sustaining capital construction services and maintenance.
Notably, shares of KBR have gained 50.6% year to date, outperforming its industry and the S&P 500 composite’s average growth of 23.5% and 14.4%, respectively. The contract winning spree underscores KBR's strong ability to safely and efficiently deliver projects in operating facilities.
Zacks Rank & Another Key Pick
Currently, KBR carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Another top-ranked stock in the same space is Quanta Services, Inc. (PWR - Free Report) .
Quanta Services currently carries a Zacks Rank #2. Its earnings for the current year are expected to increase 28.1%.
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